In 2010, the Lagos state government established Lagos Home Owners Mortgage Scheme popularly called Lagos HOMS to reduce the housing deficit of a state whose population stands at over 21 million. This article analysis the some of the pains and a whole lot of the gains of the scheme 6 years after the idea was conceived.
Housing deficit and challenges in Nigeria is a known fact and has been an issue for decades now. Nigeria’s population growth rate in 2012 was estimated at 3.2% and the country’s growth rate in 2012 has been averagely 2.5% since 2008. Unfortunately, the housing development pace cannot keep up with this population growth rate. There is a deficit of between 14 and 17 million housing units and a greater number live in substandard conditions. It has been estimated that over 80% of the country’s population live in informal housing; on structures of varying levels of degeneration and lands with no legal tittles. Despite the efforts by the government and private sector, the housing challenges still remain.
Provision of affordable housing has been said to be one of the cardinal programmes of the Lagos State Government. Various housing schemes launched be the state government created 9,752 houses (completed and ongoing) to combat the housing deficit in Lagos which stands at 3 million units.
Through the inauguration of the Lagos Mortgage Board, the past regime made it clear that its mandate is to provide affordable housing for residents of Lagos with a focus on first time buyers.
At the inception of this initiative, the state government planned to allot between 200-300 units every month. This has however not been achieved. Features of this scheme include, a 10-year minimum tenor for the loan and a maximum 20 years; down payment of 30% of the total asset value of the property; and some administrative charges – 10,000 fee for civil servants and 25,000 naira for others. The scheme was also limited to residents of Lagos state who must be under the age of 60 years and have verifiable means of income. Further eligibility requirements include proof of credit –worthiness, payment of 6% interest rate on the mortgage loan, and the purchased houses must be occupied by the beneficiaries and cannot be transferred or rented out until all obligations have been fulfilled.
Although the Omole Scheme 2 Oko Oba, Agege, Ilubirin Foreshore Estate Eti-Osa, Ijoya Badiya Housing Estate, Apapa-Iganmu are still under construction, 20 of the scheme have been completed.
I’m not sure a lot of people believe that the Lagos HOMS has been a success till date, however, large number of units have already been delivered by the scheme. The current administration appointed a new General Manager for the Lagos State Mortgage Board (custodian of the Lagos Home Ownership Scheme) in order to get the initiative going. There have also been complaints of delay in meeting funding obligations from some of the contractors; some other contractors have been alleged to have abandoned work after receiving up to 60% of the taxpayers’ money.
Despite these hassles, the current administration is still committed to keeping up the promises of government. The 1254-unit Ilubirin Housing Estate Project has also been subject to discussions of a potential deal restructuring with commercial developers to harness the highest and best use of the location
The Lagos HOMS which was officially launched on February 3, 3014 was inspired by the resolve of now Minister of Power, Works and Housing, Babatunde Raji Fashola(SAN) who was then the governor of Lagos state. It was set up to bridge the estimated 3 million plus housing deficit in Lagos State and ensure that the Lagos state Government lives up to its social obligation to provide affordable shelter for its citizens.
Nonetheless, the success of the Lagos HOMS relies heavily on the continuous timely mortgage loan repayments of mortgagors and political stability on the part of the state government.
Continuous housing delivery and project sustainability is strongly led by government through a dominant ruling party. Power has not changed hand in the last 20 years and projects like Lagos HOMS is expected to endure with political stability.